PMG Property Funds Management Ltd launched a new fund yesterday specifically designed to make commercial property investment possible for more generations of New Zealanders.
- its 24-hour fully digitised application onboarding & investment tracking portal
- providing a lower minimum investment amount and,
- in the future, PMG intends to allow investors to invest small amounts often into the fund and reinvest their monthly cash distributions.
PMG will hold presentations in 8 centres over the next week and open the fund to investment by New Zealand residents on Thursday. Closing date is Friday 27 March.
The company is offering:
- 33 million units at $1/unit in a $52.9 million portfolio of 3 properties
- minimum investment 1000 units
- loan:value ratio 43%
- forecast annualised gross cash distribution return 5.8c/unit (net of expenses & fees but before tax).
The initial 3 properties are:
- Christchurch, Wigram, 67 Vickerys Rd
- Hamilton, Rukuhia, 26 Sharpe Rd
- Wellington, Grenada North, 32 Jamaica Drive.
Mr McKenzie said this fund would break downs barriers to commercial property investment, in line with PMG’s purpose to help New Zealanders achieve financial freedom.
“PMG Generation Fund not only provides better access to commercial property investment, it also provides investors with the same benefits PMG’s other 4 unlisted investment funds have, including regular cash income, the spread of investor risk through the diversification of properties & locations in one fund, and being managed by an experienced property funds manager.”
Historically, he said, many New Zealanders found commercial property investment difficult to access due to a lack of confidence & understanding of commercial property, difficult application & investment processes and high minimum investment levels.
The fund intends to acquire 3 industrial properties in Hamilton, Wellington & Christchurch occupied by Coca Cola Amatil, Euro Steel Corp & Warehouse Group subsidiary Torpedo7.
“Compared to other cash investments such as term deposits (currently returning between 2.5-3%), bonds & other unlisted commercial funds’ offers currently in the market, in our view 5.8% represents a good return on investment.
“Initially, PMG is targeting to acquire sought-after industrial properties into the PMG Generation Fund. In time (and subject to a regulatory approval which we are currently seeking) the fund plans to invest in indirect ownership of commercial property via unlisted property funds & listed property vehicles. This will spread investor risk across a wider pool of investment assets and generate sustainable returns now & in the longer term.”
Attribution: PMG release.